original papers : Spatial social networks
AbstractWe introduce a spatial cost topology in the network formation model analyzed by Jackson and Wolinsky, Journal of Economic Theory (1996), 71: 44-74. This cost topology might represent geographical, social, or individual differences. It describes variable costs of establishing social network connections. Participants form links based on a cost-benefit analysis. We examine the pairwise stable networks within this spatial environment. Incentives vary enough to show a rich pattern of emerging behavior. We also investigate the subgame perfect implementation of pairwise stable and efficient networks. We construct a multistage extensive form game that describes the formation of links in our spatial environment. Finally, we identify the conditions under which the subgame perfect Nash equilibria of these network formation games are stable.
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Bibliographic InfoArticle provided by Springer in its journal Review of Economic Design.
Volume (Year): 5 (2000)
Issue (Month): 3 ()
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Web page: http://link.springer.de/link/service/journals/10058/index.htm
Find related papers by JEL classification:
- A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
- C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
- D20 - Microeconomics - - Production and Organizations - - - General
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